Germany Scores with Double-digit RevPAR Growth
MARCH 6, 2007. Year-end results from the HotelBenchmark(TM) Survey by Deloitte reveal that revenue per available room (revPAR) across Germany grew by 10.7% to EUR55 in 2006. This is the first time the country has reported double-digit revPAR increases since 2000 and marked a significant improvement on 2005 when the country saw growth of just 1.5%.
German hotels have enjoyed strong growth in average room rates - particularly last summer, when over two million fans descended on the country for the World Cup. Performance was also bolstered by the improved economic landscape which fuelled both corporate and leisure demand.
Every city, except Rostock, posted positive growth during 2006 - and for many, this was in double-digit territory. Dortmund topped the tables with revPAR increases of over 20%, as a result of exceptional performance during the World Cup and strong corporate demand. Dresden came a close second with revPAR up 19.2%, driven by improvements in both occupancy and average room rate.
Tourists flocked to the city following the reopening of its famous cathedral and historic art collection. Berlin romped home in third place - with revPAR up 19% on the prior year. The city basked in the glory of the World Cup, particularly on the night of the final when revPAR hit EUR283. This is particularly impressive given that the city closed the year at EUR65.
Markus Luthe, CEO of the German Hotel Association (IHA) commented: '2006 was a great year for German hotel performance. The country was in the spotlight of the media during the summer and a very positive image of Germany was projected across the world. All of this bodes well for the future of the German hotel industry. For 2007 however, we expect to see a slight slowdown in performance due to the VAT increase that came into place on 1 January, which will have an impact on leisure travel. Also, the economy is expected to grow at a slower rate than in 2006.'
Lorna Clarke, Executive Director of HotelBenchmark(TM) at Deloitte added: 'Germany put in an exceptional performance last year - achieving one of the highest growth rates of any country in Europe. The increased media attention surrounding the World Cup has helped raise Germany's profile more on an international scale - which should continue to have a positive knock-on impact for hoteliers. Given the absence of the World Cup - performance is unlikely to be as strong in 2007 - however we still expect the market to turn in good results. First 2007 figures from our survey show that hoteliers are getting off to a great start with revPAR up 6.2% in January.'
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